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Independent assessments of the Budget Report

As background to the Budget, the Institute for Fiscal Studies (IFS) published a summary of recent analyses looking at the likely trends in household incomes over the next few years and, in particular, how they are likely to be affected by tax and benefit changes that are currently planned for 2012/13 (see IFS Briefing Note BN126). This found that households with children will lose most from tax and benefit changes in the coming year (see IFS press release).

the common assertion that increasing the personal allowance is progressive is true if one considers the gains across individual income taxpayers. It is not true if one considers the gains across all families as relatively few of the poorest families contain a taxpayer and two-earner couples gain twice as much in cash terms as one-earner families.

The IFS post-budget impact analysis can be found on the IFS website. The IFS finds that the overall impact of all measures introduced by the Coalition is broadly regressive, but when the full impact of Universal Credit is included, the winners and losers are more evenly distributed across the income spectrum.

The Women’s Budget Group has analysed the impact of the budget on women (see Women ‘hit worst’ by austerity measures[JM1] ). Their analysis concludes that the budget will undermine gender equality in the UK. Their report points out that the above inflation increases in the personal tax allowance does not help those with no earnings or those whose earnings are below the threshold. The report emphasises that the budget must be seen in the context of an increasing squeeze on public spending, cuts in public sector services; loss of public sector jobs; and the public sector pay freeze and the prospect of further falls in public sector pay in the poorest regions. See: the Women’s Budget Group website.

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PSE:UK is a major collaboration between the University of Bristol, Heriot-Watt University, The Open University, Queen's University Belfast, University of Glasgow and the University of York working with the National Centre for Social Research and the Northern Ireland Statistics and Research Agency. ESRC Grant RES-060-25-0052.